Thank you. Good morning, everyone.

As mentioned, we'd like to welcome you to Major Drilling's conference call for the third quarter of fiscal 2026. With me on the call today are Denis Larocque, President and CEO, and Ian Ross, CFO.

Our results were released last night and can be found on our website at www.majordrilling.com. We also invite you to visit our website for further information.

Before we get started, we'd like to caution you that during this conference call we will be making forward-looking statements about future events or the future financial performance of the company. These statements are forward-looking in nature, and actual events or results may differ materially from those currently anticipated in such statements.

I'll now turn the presentation over to Denis Larocque, President and CEO.

Thank you, Ryan, and good morning, everyone, and thank you for joining us today to discuss our third quarter results. While the third quarter is typically the weakest of our fiscal year, as customers pause operations for the holiday period, we began aggressively preparing for what is shaping up to be a very busy year.

Over the last several weeks, many of our senior mining customers have released their exploration budgets, with some pointing to increases of 30+% while others look to almost double their budgets when compared to last year. Meanwhile, the juniors remain well-supported, having raised substantial capital for exploration in the second half of 2025 and continuing into 2026.

In preparation for a much busier year, we leveraged our industry-leading balance sheet to ensure that we are as ready as possible, completing additional maintenance above and beyond what we would normally look to do in the quarter to maximize the availability of rigs and support equipment. We also proactively ordered additional supplies to reduce the potential impact of any future supplier delays as demand for these items increases.

Lastly, we retained and hired additional crews despite the slowdown in activity during the holiday season as the industry is already beginning to experience labor challenges in some regions. With larger exploration budgets and record high commodity prices, we experienced a busier start to the year with a much busier January when compared to last year.

While the associated startup and mobilization costs also had a negative impact on margins, our revenue increased by 15% compared to the same quarter last year, driven mostly by much higher activity levels in Canada and U.S. With activity levels expected to continue to ramp up over the coming months as a result of significantly higher exploration budgets and a healthy financing market for juniors, we remain very optimistic heading into 2026.

I'll discuss more of the outlook once Ian has taken us through the financials. Ian?

Thanks, Denis. Revenue for the third quarter was $184.6 million, up 14.9% from the same period last year, driven primarily by Canada and the U.S.

and, to a lesser extent, by further growth in Peru. This was partially offset by Australasia and the African region, which continued to be impacted by a slowdown of drilling operations with the company's largest customer in Indonesia, as discussed last quarter.

The unfavorable foreign exchange translation impact on revenue, when compared to the effective rates for the same period last year, was approximately $1 million, while the impact on net earnings was minimal as expenditures in foreign jurisdictions tend to be in the same currency as revenue. The overall adjusted gross margin percentage, excluding depreciation, was 14.3% for the quarter, compared to 19.5% from the same period last year.

The decrease in margins was attributable to strategic steps taken to prepare for what is expected to be a much busier year, increased startup and mobilization costs resulting from a busier January, and the termination of underperforming contracts in South America to better position the region for improved profitability going forward. G&A costs of $21.6 million were flat when compared to the prior year period, as annual wage adjustments were offset by reduced Explomin integration costs, which impacted results last year.

The company generated EBITDA of $5.1 million in the quarter, compared to $7.8 million in the prior year period, with a net loss of $10.8 million or 13 cents per share, compared to a net loss of $9.1 million or 11 cents per share for the prior year period. Despite the seasonally slow quarter and additional preparation costs, the company increased its net cash position by over $25 million to $39.6 million at quarter end, while total available liquidity increased to $177.1 million.

CapEx in the quarter totaled $10.3 million, compared to $12.6 million in the same period last year, with the addition of three new drill rigs and support equipment. The company also ramped up its fleet optimization and modernization efforts in preparation for a busier year, which resulted in the disposal of 13 older, less efficient rigs, bringing the total rig count to 697 rigs at quarter end.

The breakdown of our fleet and utilization in the quarter is as follows: 306 specialized drills at 49% utilization; 158 conventional drills at 53% utilization; 233 underground drills at 55% utilization; for a total of 697 drills at 52% utilization. As we've previously noted, we define specialized work not necessarily by the use of a specialized drill, but by work requiring a higher degree of technical expertise, access to remote locations, stringent safety standards, and other operational complexities.

In the third quarter, specialized work accounted for 59% of our total revenue. We continue to see high levels of demand for our specialized services and expect this trend to continue as deposits become increasingly more challenging to find, with discoveries continuing to be made in remote locations.

Conventional drilling declined to 12% of revenue for the quarter, while underground drilling contributed 29% of total revenue, providing a stable base of work largely in operating mines. We continue to see the bulk of our revenue driven by seniors and intermediates, representing 90% of revenue this quarter as they continue their elevated efforts to address depleting reserves.

With financing activity beginning to increase, juniors grew to represent 10% of revenue in the quarter, an increase from the 8% recorded in the prior quarter and 6% in the same period last year. In terms of commodities, gold represented 39% of revenue in the quarter, while copper accounted for 32%.

Iron ore continues to make meaningful contribution at 8%, aided by our Australian operations, and demonstrating the diversity in the commodities for which we drill for around the world. Also of note in the third quarter was silver, which continued to represent 6% of revenue.

With that overview of our financial results, I'll now turn the presentation back to Denis to discuss the outlook.

Thanks, Ian. Looking ahead, having now completed a significant amount of prep work, we enter the fourth quarter of our fiscal year with a strong foundation in place to support many of our clients around the world with their larger exploration budgets and resource expansion goals.

Aside from our well-maintained fleet of nearly 700 rigs, our optimal levels of inventory, and our experienced crews, we also remain well-supported by our industry-leading balance sheet as, despite the additional preparation work which was completed in the quarter, we still increased our net cash position by over $25 million. As activity levels ramp up through our fiscal fourth quarter and into fiscal 2027, we expect to gradually deploy additional rigs at incrementally higher pricing, driving steady revenue growth.

While labor availability is expected to remain a near-term challenge and will continue to pressure margins, we anticipate that improving pricing will progressively offset these costs. As a result, margins are expected to improve over time, but at a slower pace than revenue growth.

Overall, we remain very optimistic heading into 2026, given our level of preparedness combined with record high commodity prices leading to significant increases in exploration budgets, as well as significant increases in the amount of capital raised by junior mining companies. In closing, I'd like to invite any customers or investors that will be attending the PDAC conference in Toronto next week to visit our booth.

With record high commodity prices and a strong mining market, we're looking forward to a busy and very productive conference. With that, we can open the call to questions.

Operator?

Hey, good morning, and thank you for taking my question. Can you elaborate on some of the strategic initiatives you mentioned being implemented in North America?

Just want color on that.

Yes. Basically, it's just on the hiring and the retention of people.

Typically, the way it works in our industry, when you get to Christmas, you don't know what's coming around after Christmas and you let people go home and then you call them back when you get to January. This time around, we didn't run that chance.

We held on to people during the Christmas break. Also, even as we entered the third quarter in November, we ramped up our efforts on training because we were anticipating 2026 to be busier.

Therefore, we ramped up our recruitment, our training, to make sure that we would be able to increase our labor force and be able to put more rigs to work in 2026. Then on top of that, we took more rigs out of the yard to basically get ready again, to make sure that we were ready for an uptick in activity.

That's great. Looking at South America, are you able to comment on revenue synergies from Explomin as well as your expectations on cost-cutting in the region, specifically Peru?

Yeah.

Explomin has been a great addition. As a reminder, when we made this acquisition, we specifically pointed to the fact that it's a slightly different business model.

It's more a volume play. It's because it has more underground than our typical operation, so, therefore, slightly lower margins by definition, but also lower CapEx or asset.

Therefore, the return on capital is similar to the rest of our operation, but just the mix or the revenue margin mix is a bit different. It's been good for us.

Now the region in general, as we mentioned, we repositioned. We had a few contracts, not just in Peru, but in other areas as well, where we terminated underperforming contracts and moved on rigs and that had an impact on the performance of the region.

Yeah.

No, that's great. Thank you very much.

Thank you.

Hey, good morning, guys. Just regarding the termination of the underperforming contracts in South America, just curious if new work has been sourced for these rigs or if some of these rigs were included in the disposal of those 13 older rigs you guys discussed?

No, it didn't have any connection to disposal of rigs. That's basically globally.

In the third quarter typically, that's where we bring rigs back in the shop, and that's where we make decisions on if we should repair or basically dispose. On the contracts, basically, we did replace some of those contracts with better contracts, and so we expect to the performance of the region to improve in 2026.

Thanks for that. Then just moving over to CapEx, CapEx is currently trending a little bit below guidance.

Just wondering if we should be expecting an uptick in CapEx for Q4?

There is some timing related to the lower CapEx in Q3, and we will see an uptick on the run rate we've had here going into Q4, but we will be below the $70 million guidance we had for fiscal 2026. Then we're just entering the budget season right now internally, and we'll be giving guidance on our fiscal 2027 CapEx amounts next quarter.

Thank you. Then final one for me.

Just wanted to see if I can kind of quantify Canada, U.S., because it was phenomenal growth year-over-year. Just wondering how much of the year-over-year growth was due to kind of the extension of programs through January, making it a strong year-over-year comparison, versus actually taking on new work?

The extension was not too dissimilar to last year, but really we had contracts that started earlier in. This is typical of when we are in this environment where commodity prices are good and where mining companies are eager to get out in the field.

In years where things are slow, we're usually calling to get a start date, and then things get pushed to February, and then things drag. This year it was the opposite.

It was customers calling, saying, "Well, can you get there by this date? We want to get going because they've got a budget, and they want to make sure that they're going to be able to get through all the work that they have to do."

It was more related to the January startups, earlier startups really.

Okay. I appreciate the color, guys.

I'll hop back in the queue.

Thank you.

Hi, guys. Good morning.

Thanks for taking my question.

Good morning,

Rhett.

You guys have continued to stay ahead of the curve in terms of preparing for the industry upturn. Your actions this most recent quarter are consistent with that.

Is there any color you can provide based on your experience, past cycles, in terms of what you're seeing in overall tightness in the industry, both rigs available to customers from the rig owners, such as yourselves, as well as your ability to procure additional rigs and support equipment in terms of lead times from your suppliers?

Yeah. It's already starting to get pretty tight on rigs.

In fact, and this is particularly in Canada and U.S., when you talk to industry players, they're seeing it. In terms of the availability of rigs, it is I would say probably taking a little bit longer, but still not necessarily a lot, because there was still capacity.

It's not a rig issue, it's a people issue. When I say things are getting tight, it's more on crews than rigs.

We know competitors that basically are struggling even just to put additional rigs just because they don't have any crews. It's more going to be a labor issue than a rig issue.

That's why I'm saying we're not seeing a lot more delays than usual on the rig side.

Okay.

I'll tell you though, having said that, the place where there's going to be bottlenecks will be the supplies. That's the rods and the supplies and consumables, because what happens is that with more rigs going out in the field, everybody's ordering at the same time because most companies have been basically running on just-in-time and just having enough supplies to have the rigs running.

When you have a whole bunch of rigs going out, you have all these orders, and that's why we placed orders and we kept inventory higher because we've seen before in previous cycles where you have real bottlenecks because suppliers basically they don't have enough on the shelf to supply all that demand that comes in all at once.

Very helpful. Denis, with the incremental actions you've been taking, do you feel like labor's in an okay-ish position now to meet the activity ramp-up you guys are expecting this year?

No, we feel pretty good. It's still our teams are still working hard, and still it's still not easy, but we are in good shape at this point.

Terrific. Thanks so much.

Thank you and good morning. Just a very quick question.

You suggested that margins were hurt by the incremental costs for future activity plus the cost to terminate the underperforming contracts. Can you put a number on those two so we can get an idea what the real margin experience was in the quarter?

When you look at last year really, if those things hadn't been in place, the margins would probably be similar to last year.

Okay. Really

the difference in the margins between years are attributable to these items.

Okay. Great stuff.

Thank you. Looking forward to what's next.

Thank you. You've seen this in the previous cycle, right?

So... It's been a long time coming.

I agree.

All right, thank you. Good luck.

Thank you. Thanks.

Thank you. As I said, for those of you in town in Toronto next week, please stop by our booth.

Our teams are going to be around and looking to an exciting week and an exciting year for sure with everything that's happening in the mining world. Thank you for attending today.